JERUSALEM, Israel - The European Union should be pressuring the Palestinians to return to the negotiating table instead of discussing the division of Jerusalem, Israel's Foreign Ministry said on Tuesday.

The statement came in response to an article in a leading Israeli newspaper quoting a European draft resolution that calls for Jerusalem to be divided, with part becoming the capital of a Palestinian state.

According to the Israeli daily Haaretz, the document expresses EU concern over the stalled peace process and calls for an immediate resumption of Israeli-Palestinian talks with the goal of "an independent, democratic, contiguous and viable state of Palestine, comprising the West Bank and Gaza and with east Jerusalem as its capital."

Israel maintains that the whole city of Jerusalem, which was united under Israeli sovereignty as a result of the 1967 Six-Day war, will remain its undivided capital forever. But Palestinians want the eastern part, including the ancient Old City, to be the capital of a future Palestinian state.

"The European position regarding the resolution of the Israeli-Palestinian conflict is well known, but this initiative led by Sweden [which holds currently holds the rotating presidency of the EU] will hurt the EU's ability to take part and be a meaningful factor as a mediator between Israel and the Palestinians," the Foreign Ministry said in a statement.

The Foreign Ministry statement also referred to the decision by the Israeli government last week to freeze new building in Judea and Samaria (the West Bank) as a gesture to jump start Israeli-Palestinian negotiations.

"After the meaningful steps taken by the Israeli government to enable the re-engagement of the negotiations with the Palestinians the Europeans should exercise pressure on the Palestinians to bring them back to the negotiating table.

"Steps like the ones led by Sweden will only bring the opposite result," the statement said.

The European Union offered no official comment on the report.

But one European source told CBN News that at least one member state of the 27-member EU was already asking for changes in the declaration. Without consensus on a foreign policy declaration it cannot be passed, he said.

The source also noted that such a declaration would only be a "small semantic jump" from the position already held by the EU. "Everybody imagines Jerusalem will be the capital of Palestine," he said.

But one Israeli Foreign Ministry source told CBN News that the Europeans didn't understand the steps that Israeli Prime Minister Benjamin Netanyahu had taken to move the peace process forward.

Netanyahu made an "historic declaration" that no other prime minister has made, he said. What the EU is doing is telling the Palestinians not to go to the negotiating table. They are crippling the ability of the Palestinians to learn from their mistakes, he said.

Until recently, the Palestinians never demanded a freeze on settlement construction as a pre-condition to entering negotiations, he said.

Dr. Guy Harpaz of the Hebrew University said there was really "no news" in the reports of the draft declaration because it is already known how the EU thinks. What it does imply, he said, is that they may be willing to accept a unilateral Palestinian declaration of independence.

While that is not legally binding it could have legal implications for the future, Harpaz told CBN News.

Harpaz added that the EU often tends to perceive the "complex realities" in the Middle East "Hollywood" style of the "goodies" versus the "baddies" but that is too simplistic, he said.